Citizens pay heavy price for state’s sprawl subsidies

The Michigan Land Use Institute and United Cerebral Palsy of Michigan began this project believing that state spending was the most important cause of Michigan’s sprawling patterns of development and its many ugly side effects — urban decay, environmental degradation, poor public transportation services, and increased hardships for people in general and those with disabilities in particular. Our findings, the culmination of a peculiar sort of fiscal archaeology, confirm that conviction. Sifting through dozens of local and state spending accounts, we found that a significant portion of the billion the state spends each year in taxpayer-supported economic development programs — a system of grants, subsidies, tax abatements and incentives, loans, bonds, and direct outlays — is giving Michigan one of the nation’s worst cases of sprawl.

MLUI/Pat Owen

Pontiac, Michigan

Follow The Money documents a pervasive pattern of public investments for roads, jobs, government offices, and business development that encourages runaway sprawl. In almost every category of state economic development spending, cities and older suburbs lose and new suburbs win. And while it is the residents of older cities and suburbs who must dig deep into their own pockets to keep their communities afloat as needed state money flows elsewhere, every Michigan citizen ultimately pays.

Once-rural Garfield Township, in northern Michigan’s Grand Traverse County, received more than $20 million in state and federal support to execute a business development strategy that encouraged sprawl. This has triggered an expensive traffic congestion problem and forced the township to double its sewer rates to keep up with growth. Residents of Grand Rapids, in contrast, used only modest amounts of state support for its $2 billion redevelopment program, which has revived business, housing, jobs, the arts, and the civic spirit of Michigan’s second largest city.

Daimler Chrysler and two Japanese partners are building two new engine plants, worth $700 million and employing 600 people, in a 245-acre field in rural Monroe County. Michigan kicked in $53.65 million in business tax credits and property tax abatements, plus job training, community development, and road construction grants. Governor Jennifer Granholm heralded the plants as “great news” at a time of severe manufacturing sector job losses. Michigan did try to promote some urban sites, but the companies were not interested. At $90,000 per job, state spending is better directed to small businesses and suppliers ready to locate in cities.

The Southeast Michigan Council of Governments directs more than $600 million annually to the Detroit region for transportation, much of it to modernize and maintain roads in the outer suburbs, where half of the seven-county region’s residents live. Meanwhile, the 2.4 million people in Detroit and its inner suburbs cope with substandard streets and public transportation that limit their mobility and job prospects. Richard Bernstein, a Wayne State University trustee who has been blind from birth, says: “If you can’t drive, and you can’t afford someone to drive for you, you don’t have a life here.”

Many of the billions that the state spends each year in economic development programs are giving Michigan one of the nation’s worst cases of sprawl.

Follow The Money informs citizens about how public investments accelerate sprawl and provides state lawmakers with a new way to look at pro-suburban spending decisions: They exacerbate state and local budget deficits, harm Michigan’s overall economic competitiveness, and make communities less, not more, supportive of people in general and people with disabilities in particular.

Myron Orfield, a researcher and former Minnesota state senator, concluded last year in a report for the Mott Foundation that nearly two-thirds of southeast Michigan residents live in communities that are sliding toward a future of limited economic opportunity. That future eerily resembles what Detroit and its older suburbs already endure: Growing poverty in public schools, weak or declining tax bases, inadequate roads and sewers, and stagnant household incomes. The same patterns, said Mr. Orfield, are also occurring around Grand Rapids, Lansing, Flint, Kalamazoo, Saginaw, and Traverse City.

The state’s failure to use public dollars to encourage smarter economic development hurts every Michigan resident. Traffic congestion is increasing, even though Michigan is among the nation’s slowest-growing states. Water pollution from sewage treatment plants, overwhelmed by sprawl’s heavy stormwater runoff, threatens public health in dozens of cities. Michigan residents spend 20 percent more for school construction than they did 10 years ago, even though the student population increased by less than 4 percent. And state and local budget deficits continue to grow, due to the exploding cost of building and maintaining public infrastructure and services across a spread-out domain.

During her 2002 gubernatorial campaign, Jennifer Granholm called for ending subsidies that cause sprawl. After her election Governor Granholm said she would strengthen cities. Follow The Money is a valuable tool for helping her accomplish both goals. This report documents a profoundly misguided investment strategy that harms Michigan’s quality of life by subsidizing sprawl. Only when that strategy improves will Michigan be able to conserve its natural resources, produce more job opportunities, enjoy great cities, and restore our rapidly diminishing sense of community — bedrock necessities for competing successfully in the 21st century.

Sprawl Disables EveryoneFour years ago, United Cerebral Palsy of Michigan and the Michigan Land Use Institute began collaborating on a transportation project funded by the Michigan Developmental Disabilities Council. We teamed up because UCP and the Institute strongly support greatly improved public transportation, a critical need for people with disabilities who don’t drive. But we now realize that our commonality is even greater: Land use policy itself is a disability issue.

Sprawling communities, automobile dependence, a lack of curb cuts on sidewalks, and strip mall stores separated from bus stops by oceans of parking: All form significant barriers to basic mobility for many people with disabilities. Worse, sprawl’s rush to the suburbs is decaying the urban core, often the only place people with disabilities can find affordable housing. This raises significant safety issues for people with certain kinds of disabilities. It raises sizeable employment issues, too, as jobs move to the suburbs, where they are out of reach of people who cannot drive and lack access to good public transit.

The sheer cost of sprawl is also crucial to the disability community. Soaring infrastructure costs draw critical dollars from programs like transit and accessible housing that help people with disabilities live more independently. We need communities that are compact and equipped with readily accessible sidewalks, public transportation, and affordable housing. A community that works well for people with disabilities works extraordinarily well for everyone. It is a goal we must all share and work towards.